Minnesota’s attorney general filed a lawsuit Wednesday against CenturyLink, claiming that the company had billed customers higher amounts than its sales agents had quoted.
After customers caught discrepancies on their bills, the company often refused to honor the prices quoted by sales agents, according to Attorney General Lori Swanson.
“I want the company to knock it off,” Swanson said in a news conference Wednesday morning. “It’s not OK for a company to quote one price and then charge another.”
The state’s lawsuit gives examples: A Blaine customer was quoted a $39.97 base monthly rate for cable service, but was charged $71.97; a Columbia Heights customer was quoted $14.95 base monthly rate for internet service, but charged $29.95. Many customers were charged hundreds more than they were quoted over the course of several months.
“What it worked out to be, in my opinion, is satisfaction guaranteed — theirs not mine,” said CenturyLink customer Richard Thompson, 26, of Blaine.
The company said in a statement that it has cooperated with Swanson’s office since the investigation began.
“We are disappointed that the Attorney General has chosen a press conference to communicate her concerns instead of contacting CenturyLink directly,” the company said. “We take these allegations seriously and will review and respond in due course.”
Swanson described CenturyLink’s cooperation as “pretty lackluster” at best. The company refused to disclose the promotions made to Minnesota consumers, calling the request “unduly burdensome,” according to Swanson.
The company’s internal records note the extent of the problem, according to Swanson.
“I could say maybe 1 out of 5 are quoted correctly or close enough,” one CenturyLink employee told another in an email that is quoted in the lawsuit. “I have one today quoted $39 and its over $100 monthly. So I tend to get on the defensive for the customer at times because of the large amount that are misquoted.”
Thompson said he is glad Minnesota is taking on the telecommunications giant.
“My mother isn’t going to fight this, my uncle isn’t going to fight this, my neighbors may or may not fight this, somebody’s gotta fight this,” he said.
The lawsuit, filed in Anoka County District Court, seeks an end to the alleged practices, restitution for customers and civil penalties.
The lawsuit and the attorney general’s office describe CenturyLink’s system as such:
First, representatives promise customers false prices during sales calls, as verified by many written transactions and recorded phone calls, the attorney general’s office states.
They also don’t tell customers about the rules and exceptions to the promotions. CenturyLink reported as many as 29 conditions and exceptions per promotion as well as up to 138 “disqualifying” combinations of promotions, Swanson said.
Consumers don’t realize they’ve been misquoted until they receive a higher bill, she added.
Then, when customers confront them, CenturyLink provides a bevy of excuses: Promised discounts need not be honored because they are “a gift from us to you”; “You were misquoted” but “I can’t give it (the quoted price) to you, no one can”; the previous agent you spoke to didn’t “even know what offers we have to offer in the first place”; CenturyLink can “raise or lower the base product price” after making an offer.
Ben Meiselas, an attorney involved in a customer class-action lawsuit against CenturyLink, called the business technique a “catch me if you can” strategy.
“They take your money out, defraud you, and put the burden on you as a consumer to catch that,” said Meiselas, of the Los Angeles law firm of Geragos & Geragos. “That’s not the way business is supposed to work.”
Patrick Sharkey, 27, of Minneapolis said the business’s customer service is just as bad. After a service outage he says CenturyLink was slow to respond to, the company offered him three free months of service for the inconvenience. He never received the free service and was overcharged for his last month.
“I’d been through countless phone calls with them. I was just happy to be done,” Sharkey said. “There were many times when I was so fed up that I was very close to being willing to just pay the fee (to end the contract early), but then I was promised ‘We’ll take 10 bucks off.’ ”
Sharkey eventually got the $10 off for two months, but it took several phone calls of several hours, he said.
Earlier this year, a former employee sued the company alleging she was fired after raising issues with management, saying customers could be hit with fees and charges they didn’t want.
And customers in seven states — Arizona, California, Colorado, Idaho, Nevada, Oregon and Washington — have sued, alleging CenturyLink used fraudulent billing practices.
According to Meiselas, customers from pretty much every other state are clamoring for lawsuits as well.
He praised Swanson’s action.
“We’re certainly proud that at the outset, we brought attention to the fraud that was taking place, but also we commend government officials and especially Ms. Swanson for standing up to a big, billion-dollar bully who has defrauded her constituents,” Meiselas said.
Meiselas said they hope to get complete refunds for CenturyLink’s customers. He estimated damages could reach $12 billion.
CenturyLink is based in Louisiana and offers cable television, phone and internet services.
The company employs 2,590 people in the state of Minnesota and about 40,000 people nationwide. It serves nearly 6 million broadband subscribers in the country.
CenturyLink shares lost 3.2 percent Wednesday, to $22.50. The company reported earnings of $163 million in the first quarter of 2017 and a total of $626 million in 2016.
Minnesota Attorney General Lori Swanson urged CenturyLink customers to ask about details of specific promotions (rules, exceptions, end dates, etc.) before signing up; to request written documentation of all quotes; to record all interactions with CenturyLink; to scrutinize their bills; and to immediately contact CenturyLink if overcharged.